The so-called flash crash refers to an incident on the afternoon of 6 May 2010, when the Dow Jones Industrial Average plunged several hundred points in a matter of minutes, although it recovered later on.

Sarao has been accused of various fraud and manipulation offences, which in total carry a maximum sentence of 380 years, as the US authorities allege he used customised software to place vast numbers of sell orders with no intention of following through on the transactions before cancelling them. Because he was allegedly doing this on 6 May 2010 at the same time another large sell order for "e-mini" futures on the S&P 500 was placed, the US authorities contest that Sarao contributed to the flash crash.

The US authorities claim that Sarao was spoofing to take advantage of artificially lowered prices, allowing him to pocket $40m (£27.6m) over the course of several years.

However, Reuters reported that Sarao's own legal team argued back that the crimes he had been accused of did not constitute offences in Britain, so he should therefore not be extradited.

Jasvinder Nakhwal, partner at Peters & Peters, explained to City A.M. that the court in extradition hearings needs to consider whether the alleged conduct giving rise to criminal proceedings in the US would also amount to a criminal offence in the UK, adding: "If the court agrees with Sarao's defence team that what he is alleged to have done does not amount to a criminal offence in the UK, the judge must order Sarao's discharge from extradition proceedings."